iPhone's Emergency SOS Feature continues to be free

The headline from Apple’s Newsroom says a lot:¹

Apple extends Emergency SOS via satellite for an additional free year for existing iPhone 14 users

Tough for anyone to think that Apple would have made a different announcement, a la “That Life-Saving Feature of your iPhone Now Costs $5/mo!” However, those satellites in the sky are not free.

In early 2022, there was a rumor that Apple was looking to augment its Services revenue by creating a “hardware subscription” for the iPhone. Pay a monthly fee, have an iPhone. Similar to the iPhone Upgrade Program, but the person getting the phone is not taking out a loan and paying in monthly installments. Simply, they are paying ~$60/month to have an iPhone. Presumably, they could cancel at any time, give the phone back, and move on with their life.

What an interesting model this would be – and the perfect place to bundle the cost of that Satellite SOS² feature. Locking a customer into a subscription tends to make that customer more “sticky”, e.g. less likely to change away from your product. Prime examples of this are the monthly cell phone bill, where providers like Verizon and AT&T reduce the cost per line as you add more lines of service. The goal is for a consumer to get their parents, children, or friends onto the same plan – everyone pays less per line per month! – but, uh, try to switch from Verizon to AT&T now. You have to let your parents, children, or friends know “things are about to change”. And perhaps you get some resistance! Same would be true for an iPhone subscription when services like Satellite SOS, or Apple Music, or anything else is bundled into a single cost.

Amazingly, Apple did not bundle Satellite SOS into an iPhone Hardware Subscription pricing model.

Heck, they did not even bundle Satellite SOS into their existing services bundle iCloud+!

This news from Apple that they are extending the service for free for a single year does not mean iPhone owners will start paying for Satellite SOS come 2025. The “expiration” of free Satellite SOS will be extended again and again. You don’t want your iPhone branded as the thing that kills people because a trillion-dollar company did not pay the satellite bill. It’s not a good look for Volkswagen, either.